Relying on ECB to fight inflation ‘no longer viable’ – paper
Researchers argue EU should co-ordinate with central bank to tackle ‘shockflation’
Raising rates to fight supply-side inflation shocks is “not an adequate instrument” to deal with higher price growth in the eurozone, new research argues.
In a paper published on September 11, Jens van’t Klooster and Isabella Weber examine the reasons behind the 2022–23 inflationary wave. They find that the European Central Bank’s decision to tighten policy, alongside an ad-hoc series of government decisions, constituted a poor response to the spike in price growth.
They find the eurozone
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: www.centralbanking.com/subscriptions
You are currently unable to print this content. Please contact info@centralbanking.com to find out more.
You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@centralbanking.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@centralbanking.com
More on Operating framework
Repos key to post‑Covid balance sheet reduction – RBNZ
Assistant governor says further repo growth will support monetary policy, liquidity, capital markets
Waller steps up to the plate with rationale for rate setting
Fed governor compares himself to baseball umpire and says data will determine his next FOMC vote
Ample reserves can yield highest welfare – BoE paper
Central banks face trade-off between financial stability and resource misallocation, author says
Reconsidering the role of money in monetary policy
Euro policy architect Otmar Issing argues that central banks must improve their flawed inflation targeting frameworks
EU banks shrug off mooted minimum reserves increase
Doubling of unremunerated reserves would curb Eurosystem losses, but banks doubt it will pass
Overnight reverse repos are for managing liquidity, says PBoC
Deputy governor reiterates that seven-day facility still provides benchmark lending rate
Move to inflation targeting could boost resilience – IMF paper
Countries in Middle East and central Asia should make exchange rates more flexible, authors say
RBA outlines monetary tools for stimulus when rates are low
Central bank says additions to policy toolkit make it better prepared for shocks